1. What’s a Franchise?
A franchise is a business model where one party (the franchisee) is granted the rights to operate a business using the branding, products, and systems of another party (the franchisor). In exchange, the franchisee pays fees and agrees to follow the franchisor’s business practices.
2. How Does a Franchise Work?
The franchisor licenses:
- Brand name
- Operating systems
- Products or services
- Marketing strategies
- Training and support
The franchisee runs the business in an agreed location under the franchisor’s rules, benefiting from an established brand and proven business structure.
3. Common Examples of Franchises in the UK
- Fast Food: McDonald’s, Subway, Domino’s
- Coffee Shops: Costa Coffee, Esquires
- Cleaning Services: Molly Maid, Fantastic Services
- Retail: SPAR, Cash Converters
- Fitness: Anytime Fitness, F45 Training
4. Key Components of a Franchise Agreement
- Franchise Fee: Initial cost to use the brand and model
- Ongoing Royalties: Percentage of profits or sales
- Territorial Rights: Defined area of operation
- Training and Support: Provided by the franchisor
- Duration: Usually a 5–10 year agreement, renewable
5. Pros of Owning a Franchise
- Established brand recognition
- Lower risk than starting from scratch
- Ongoing training and support
- Easier to secure financing due to proven model
- Collective marketing and advertising
6. Cons and Risks of Franchising
- High initial and ongoing costs
- Less operational freedom
- Obligations to follow strict brand rules
- Risk of brand-wide issues affecting your location
- No ownership of intellectual property
7. How Much Does It Cost to Buy a Franchise?
Franchise costs in the UK vary:
- Low-cost franchises: From £5,000–£15,000 (mobile services, online businesses)
- Mid-range: £20,000–£50,000 (retail, hospitality)
- High-end: £100,000+ (fast food, fitness chains)
Financing may be available via banks or startup loans.
8. How to Start a Franchise in the UK
- Research industries that interest you
- Evaluate available franchises (use BFA-accredited brands)
- Check franchise costs and returns
- Review the Franchise Disclosure Document (FDD)
- Seek legal and financial advice
- Secure funding and sign the agreement
- Attend training and launch your franchise
Frequently Asked Questions
1. What’s a franchise vs. a chain?
A franchise is independently owned and operated under a brand licence. A chain is usually company-owned and centrally managed.
2. Can I sell my franchise later?
Yes, most franchises allow resale with the franchisor’s approval.
3. Do I need business experience to buy a franchise?
Not always. Many franchisors offer full training for beginners.
4. Is a franchise a guaranteed success?
No. While risk is lower, success depends on management, location, and market demand.
5. Can I own more than one franchise?
Yes. Many owners operate multiple units or invest in different brands.
6. Are there home-based franchise options?
Yes. Online services, virtual tutoring, and cleaning franchises often operate from home.
Conclusion
Understanding what’s a franchise is the first step toward joining a proven business model. Franchising offers a mix of independence and support, making it an attractive option for UK entrepreneurs in 2025. Do your research, know the costs, and assess your fit before taking the leap.